chapter 2 book notes

chapter 2 book notes - GAAP GAAP -A collection of standards...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
GAAP GAAP -A collection of standards and guidelines set by Financial Accounting Standards Board (FASB) with input from the SEC, and AICPA, and investors and politicians These guidelines are: -Statements of Financial Accounting Standards (SFAS) -APB Opinions -Accounting Research Bulletins -AICPA prounouncements -at the bottom: Industry practices SEC -independent, quasi-judicial gov’t agency -administer securities regulations -can modify and set GAAP, major player in global accounting but pressured to accept International Accounting Standards -rarely challenges FASB Managers of companies -primary responsibility is fair and accurate reports -major lobbyist on GAAP Auditing -SEC requires Audit report -opinion can be clean, qualified, or disclaimer Corporate Governance -financial statements need approval by board of directors -appointed audit committee oversees accounting, internal control, internal/external audit -companies often perform internal audits to prevent fraud Internal users -managers -internal auditors -budget officers External users -lenders -shareholders -gov’t
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Alternative information sources instead of Financial statements -industry and economy news -voluntary disclosure -motivation: legal liability. ..lower probability of being sued if you disclose important news -information intermediaries: industry devoted to collecting, processing, interpreting info about financial
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

chapter 2 book notes - GAAP GAAP -A collection of standards...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online